Chris Wilder was happy with the performance of his players, but disappointed with the end result, as United exited the Carabao Cup on penalties at Bramall Lane.
United bossed the second-half and Billy Sharp cancelled out Jon Toral's opener, but the Tigers clung on to take the tie to a shootout, which they won 5-4.
And Wilder was characteristically upbeat post-match, he remarked: "The best team lost, particularly in the second-half we changed our shape and they couldn't cope with us.
"They were clearing stuff off the line and their goalkeeper was outstanding yet again. They were desperate for the full-time whistle, but they took their penalties well so credit to them for that.
"It was disappointing to concede having only had the ball in their box moments earlier, but apart from that and another chance, it was us who created the best chances and played all the football.
"We were the only team trying to win the game and Hull were made up when the full-time whistle went."
Wilder reserved special praise for his newest recruit, who completed 90 minutes on his debut.
The boss added: "Oliver Norwood was outstanding, and he will be a big, big player for us. He was calm, he played forward passes and picked people out.
"We've done some fantastic business to get Oli out of Brighton for that amount and the work we did last week, sometimes I think it goes unrecognised, but we have to wheel and deal.
"It's just unfortunate he has missed the penalty because he had enjoyed a great home debut, he suits the way we play and I'm delighted to have him in the building."